Millennial couple CAUGHT for attempting to launder billions in Bitcoin | Exactly HOW they did it

You've seen the headlines, but let's breakdown the cryptocurrency laundering techniques they allegedly used in an attempt to launder billions of dollars worth of Bitcoin and the ridiculous errors they made that led to them getting caught.

Money laundering techniques they are accused of using: Peel chain technique, Chain Hopping, Layering, and more.

On February 8th, 2022, the United States Department of Justice announced that 34 year old “Dutch” Ilya Lichtenstein, and 31 year old Heather Morgan who goes by "RazzleKhan" on social media and even has her own catch phrase, were arrested in New York and charged with conspiring to launder $4.5 billion of stolen Bitcoin and conspiracy to defraud the United States.

Six years ago, 119,754 bitcoin was stolen from one of the biggest virtual currency exchanges in the world, Bitfinex. At the time, the value of those coins would have been about $72 million. As of the time I’m recording this video, one bitcoin is valued at $44,047 so the total number of coins stolen would have a current value of just under $5.3 billion. The government has seized $3.6 billion worth of cryptocurrency linked to that hack.

00:00 Intro
01:00 What are they charged with?
01:30 The Bitfinex hack of 2016
03:00 Who is this couple?
04:00 The Crocodile of Wall Street
05:40 How did they try to launder Bitcoin?
07:15 The "Peel Chain Technique"
08:00 Money laundering "Layering"
09:45 Tumbling strategy
11:14 Chain Hopping technique
12:35 Summing up how they got caught
13:05 Final Thoughts

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[PreetBanerjee]

Typo at 6:40 - Should be $3, 629, 000, 000 (missing the last set of zeroes)

Contents and timestamps:

00:00 Intro
01:00 What are they charged with?
01:30 The Bitfinex hack of 2016
03:00 Who is this couple?
04:00 The Crocodile of Wall Street
05:40 How did they try to launder Bitcoin?
07:15 The "Peel Chain Technique"
08:00 Money laundering "Layering"
09:45 Tumbling strategy
11:14 Chain Hopping technique
12:35 Summing up how they got caught
13:05 Final Thoughts

[unknown-x-]

He should have saved all the keys on a bunch of thumb drives and dig a bunch of holes all over and hide them in them.
Then wipe and destroy all devices.
He got caught red handed, if they didn't have the proof it could have been explained as identity theft.

[curties]

there is a reason why Monero and similar "privacy coins" are delisted on the "trying to be legit" exchanges lol

[SuperZed]

They screwed up by trying to cash out for fiat currency, their greed to cash out is what caused their downfall if they were patient and smart they would have not cashed out and just waited until fiats all failed and cryptos became dominant.

[gigemags]

And still no one can find or knows who Satoshi Nakamoto really is.

[ivangutierrez]

can't wait to see the Netflix doc on this soon.. so interesting

[onebadmoto]

“Yeah, what about it?

- Well, how does it work?

- It's pretty brilliant.

- What it does is, every time there's a bank transaction where interest is computed, you know, thousands a day, the computer ends up with these fractions of a cent, which it usually rounds off.

- What this does is, it takes those little remainders and puts it into an account.

- This sounds familiar.

- Yeah, they did it in Superman III.

- Right.

- An underrated movie, actually.

- And then, there were a bunch of hackers that did it in the '70s as well. One of them got busted.

- Well, so they check for this now.

- No, here's the thing. Initech's so backed up with all the software we're updating for the year 2000, they'd never notice!”

[ChaceBonanno]

They went so far to obfuscate the transactional flow, and then got gold sent to his home address, a US kyc cex account in his real name, used a Walmart account linked to his address and name, and logged everything in a cloud. It’s incredible how smart they were to pull this all off, but how dumb they were trynna get away with it. Always OPSEC lessons to be learned from these kinda stories.

[mugala]

STILL LEAVES US WITH MANY UNANSWERED QUESTIONS;
1. Switching from one currency to another is done hu many eg– if moving gala costs a fortune as an ER20 token, moving funds as XRP then repurchasing/swap for Gala on Metamask for example, would be cost effective. Has nothing to do with layering etc.
2. Many have complained of fake reports generated by some crypto ExCh, . Where one buyer has had less than $1k in business transactions, yet he or she has received a year end report they have provided/generated says $500k??? In business volume? Kucoin for example, Imagine in 10yrs from now, , What that would look like!!! A $5m defraud [kind of rubbish alibi setting, and what would it imply? What does such and tone imply? Its like editting one's academic transcript! From rhe look of things, It seems they have programing knowledge, How on earth could they have deposited such amounts on custodial drive like ¡Cloud? This brings us to another question based on the movie Eagle Eye, 2008. Did the couple really order the gold? Are they a threat to the establishment? How?

We are living in times when the public is getting more and more inversive and wants to kmow. Passivism, is no longer considered safe, rather cannot be trusted. It is just as bad as propaganda or worse.

[walan]

the host giggling at genghis khan with more pizzazz is all i needed from this video lol

[richsalazme]

So basically.. you should use a tumbling seevice that don't keep logs? Therefore removing the trace of transactions pointing to you. Also, keep every backup and keys on a hardwar device not connected online.

[lordbeerus]

It's easy.. The banks would have informed the government about huge transactions coming into these couples accounts, prompting investigations.the exchange sending the funds into the bank would have been pressured into disclosing the customers(who would've probably disclosed their details when registering).

[Alexalex-ighg]

Actually, this proves that the blockchain is the key to stop money laundering, as it is public, can be accessed at any time, and can be trace back to you.

[longstoryshortpublishing]

They should have used a VPN for the cloud storage and the server.

[Smoothinlife]

But how did they manage o get the bitcoins? You did not cover this part of the Story ;) Thanks for the video!

[lordbeerus]

Defraud the United States?. Does the United States also invest in cryptos? 😳😳

[speedacademydave]

Great storytelling, Preet! Moral of the story: crypto isn't just for anti-authoritarians, it's also for part-time magicians and Genghis Khan enthusiasts.

[snowfreeze]

Correction, he ilya was NOT released.

[___]

Makes sense but my mind was blown. Thank you for the explanation.

[ilyasalcantara]

i don´t understand the process explained at 7:22
where have these transactions been sent to and how is it possible to peel a small amount off and send it alpha bay accounts within the same transaction?